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Bryce wants to renovate his kitchen. The construction estimate is $28,400. He can finance through his local bank or directly through the construction company. The

Bryce wants to renovate his kitchen. The construction estimate is $28,400. He can finance through his local bank or directly through the construction company.

The bank (loan A) offers a maximum 6 year loan at 8% annual interest, resulting in monthly payments of $497.94.

The construction company (loan B) offers a maximum 10 year loan at 5.5% annual interest, resulting in monthly payments of $308.21.

Which loan requires Bryce to pay less, and by how much?

First, calculate the total payback for each loan.

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